2.2 Effect of Awards of Compensation Made by the United Nations Administrative Tribunal Advisory Opinion [1954] ICJ Rep 47 Purchased

This advisory opinion considers the powers of the General Assembly of the United Nations to establish a tribunal with authority to decide disputes brought by UN Secretariat members against the Secretary-General, as their employer, about employment matters. It also addresses the impact of the Tribunal’s decisions on the power of the Assembly to adopt the budget of the United Nations. Underlying those issues is the principle of the independent international public service.

Eleven staff members of the UN Secretariat had been dismissed. They were United States nationals who had refused to answer questions put by an investigating committee of the US Senate about their membership of the Communist Party or their involvement in subversive activity. They had pleaded the protection against self-incrimination provided for in the Fifth Amendment of the US Constitution. They challenged their dismissals before the United Nations Administrative Tribunal, a body set up by the General Assembly to decide staff disputes. The relevant provisions of the Statute of the Tribunal appear in the extracts from the advisory opinion set out in section III below. Their challenges were successful and awards totalling 179,420 US dollars were made in their favour.

The Secretary-General submitted to the General Assembly, as part of the budget to be approved by it, a supplementary appropriation for the amount awarded. The Fifth Committee of the General Assembly, the Committee concerned with budgetary and administrative matters, then debated the question whether the Assembly was obliged to make provision for those awards in the budget. (The United States at that time met one-third of the UN regular budget.) The competing views were captured in part by the delegates of Australia and New Zealand, the former a barrister, an ex Foreign Minister, Australia’s Ambassador in Washington and soon to be a Judge at the International Court of Justice, the latter a classicist, an early and long term member of the Secretariat of the League of Nations, and an original member of the New Zealand Department of External Affairs who had successfully proposed at San Francisco when the Charter was being drafted the inclusion of arts. 100 and 101. The Australian said this:

My Delegation would have thought that there could be no question as to the competence of the General Assembly in this matter, for it is commonplace that every executive authority must obtain the authorization in the form of an appropriation from the legislative body before it can disburse public funds. I do not think that any member of this Committee would attack the validity of the principle, which is an accepted thesis, I believe, in every country in the world, and it applies in a very special degree to an international organization such as the United Nations, which derives its funds from contributions by sovereign States. It is, indeed, precisely for this reason that the matter comes before the Fifth Committee. For at the very outset there is posed the vital question—whether the award of a tribunal set up by its authority, or whether any other outside authority can or should override the power of appropriation and its free exercise, without which no sovereign body may continue effectively to exercise its functions. However, it has been suggested by some delegations that the Assembly has no option but to make the necessary appropriations to meet without question the awards of the Administrative Tribunal. That is not a position with which my delegation can associate itself. It is our view that the Assembly has the authority to decline to accept findings of the Tribunal and has also the unquestionable authority to accept the findings of the Tribunal but to vary the awards the Tribunal has made.

The constitutional instrument of the United Nations is the Charter, which has established the General Assembly and the Secretariat as principal organs of the United Nations and which has marked out the powers of both. Neither has the power to extend or derogate from a power which the Charter has reposed in the other—or for that matter, in itself.

[…]

When we come to an award of compensation, the exercise by the Assembly of its appropriation power becomes a real issue. An award of the Tribunal may call not for passive acquiescence on the part of the Assembly, but for the exercise in a positive way of its appropriation power. Is it to be asserted that the Assembly, in stipulating in the Statute of the Tribunal that the United Nations shall pay compensation awarded, has foregone pro tanto its appropriation power? If so, by what authority did the Assembly strip itself of a power which the Charter has placed upon it. In the opinion of my Delegation there is no warrant for any such suggestion. We feel that the Assembly would have every justification for declining to exercise its appropriation power in any case in which it appeared to it that the Tribunal had acted unreasonably or improperly.¹

The New Zealander by contrast said this:

There is of course nothing to prevent the Assembly deciding to amend the powers of the Tribunal if they are found to be excessive. Indeed we have been doing this during the past few days. Nevertheless any interference with awards that have already been made is, it appears to us, save in the most exceptional cases, a denial of justice and a departure from principle.

The principle that legislation should not be retroactive is one which is firmly entrenched in most municipal systems of law. May I compare the relationship between Assembly and Tribunal with the situation in those countries which do not have a fixed constitution rigidly defining the respective competence of the courts and the legislature. In my own country, for instance, Parliament is sovereign; it can make or unmake any law past or future. It can change the composition and competence of our courts overnight. But it would be a most grave decision for Parliament to use that power to pass legislation having retrospective effect and depriving individuals of the benefit of judgments they had been given in the courts.²

The difference of opinion, just illustrated, led to the General Assembly asking the International Court of Justice the following questions:

(1) Having regard to the Statute of the United Nations Administrative Tribunal and to any other relevant instruments and to the relevant records, has the General Assembly the right on any grounds to refuse to give effect to an award of compensation made by that Tribunal in favour of a staff member of the United Nations whose contract of service has been terminated without his assent?

(2) If the answer given by the Court to question (1) is in the affirmative, what are the principal grounds upon which the General Assembly could lawfully exercise such a right?

As will appear from the extracts from the opinion given by the Court, set out below, it ruled on the following issues:

(a) The scope of the question which it was to answer, stressing in particular that there was no suggestion that the Tribunal was not properly constituted or that it had acted outside its competence; one of the Judges in the majority would also have limited the reference in the question to those awards in respect of which there was no fundamental breach of procedural requirements.

(b) The power of the General Assembly to establish subsidiary bodies, in particular a tribunal with power to make awards binding on the United Nations. Is a body with those powers ‘subsidiary’?

(c) The role of the principle of res judicata. See the passage from para. [21] of the ICJ Reports set out under section III below.

(d) The limits, if any, on the power of the General Assembly to determine its budget. The General Assembly adopts a regular budget every two years. Its exercise of its power to do that, under art. 17 of the Charter of the UN, is binding on the Members. They are obliged to pay the share of the expenses of the Organization as apportioned by the Assembly. In terms of the Assembly’s power of consideration and approval consider the ongoing obligations of the Organization in respect of employees (including pensions), any loans it may have incurred, rental arrangements, service contracts, many of which will extend beyond the budget period. Comparable issues arise in national legislatures as they consider and approve their budgets.

(e) The principle of the independent international civil service. See Chapter XV of the Charter on the Secretariat, particularly arts. 100 and 101(3), considered by the Court, paras. 36–8. See also the lecture given by Dag Hammarskjöld, the Secretary-General, cited below.

[…]

[11] This examination of the first Question shows that the Court is requested to consider the general and abstract question whether the General Assembly is legally entitled to refuse to give effect to an award of compensation made by the Administrative Tribunal, properly constituted and acting within the limits of its statutory competence. The answer to this question depends on the provisions of the Statute of the Tribunal as adopted by the General Assembly on November 24th, 1949, and on the Staff Regulations and Rules as in force on December 9th, 1953. But the Court will also take into account the amendments which were made to the Statute on the latter date. The Court will first consider whether the Tribunal is established either as a judicial body, or as an advisory organ or a mere subordinate committee of the General Assembly.

[12] Article 1 of the Statute provides: ‘A Tribunal is established by the present Statute to be known as the United Nations Administrative Tribunal.’ This Tribunal shall, according to Article 2, paragraph 1, ‘be competent to hear and pass judgment upon applications’, whereupon the paragraph determines the limits of the Tribunal’s competence as already mentioned above.

[13] Article 2, paragraph 3, prescribes:

‘In the event of a dispute as to whether the Tribunal has competence, the matter shall be settled by the decision of the Tribunal.’

[14] Article 10 contains the following provisions:

‘2. The judgments shall be final and without appeal.’

‘3. The judgments shall state the reasons on which they are based.’

[…]

[16] […] The independence of its members is ensured by Article 3, paragraph 5, which provides:

‘No member of the Tribunal can be dismissed by the General Assembly unless the other members are of the unanimous opinion that he is unsuited for further service.’

[…]

[20] This examination of the relevant provisions of the Statute shows that the Tribunal is established, not as an advisory organ or a mere subordinate committee of the General Assembly, but as an independent and truly judicial body pronouncing final judgments without appeal within the limited field of its functions.

[21] According to a well-established and generally recognized principle of law, a judgment rendered by such a judicial body is res judicata and has binding force between the parties to the dispute. It must therefore be examined who are to be regarded as parties bound by an award of compensation made in favour of a staff member of the United Nations whose contract of service has been terminated without his assent.

[22] Such a contract of service is concluded between the staff member concerned and the Secretary-General in his capacity as the chief administrative officer of the United Nations Organization, acting on behalf of that Organization as its representative. When the Secretary-General concludes such a contract of service with a staff member, he engages the legal responsibility of the Organization, which is the juridical person on whose behalf he acts. If he terminates the contract of service without the assent of the staff member and this action results in a dispute which is referred to the Administrative Tribunal, the parties to this dispute before the Tribunal are the staff member concerned and the United Nations Organization, represented by the Secretary-General, and these parties will become bound by the judgment of the Tribunal. This judgment is, according to Article 10 of the Tribunal’s Statute, final and without appeal. The Statute has provided for no kind of review. As this final judgment has binding force on the United Nations Organization as the juridical person responsible for the proper observance of the contract of service, that Organization becomes legally bound to carry out the judgment and to pay the compensation awarded to the staff member. It follows that the General Assembly, as an organ of the United Nations, must likewise be bound by the judgment.

[…]

[27] It is likewise the result of a deliberate decision that no provision for review of the judgments of the United Nations Administrative Tribunal was inserted in the Statute of that Tribunal. […]

[28] The General Assembly could, when it adopted the Statute, have provided for means of redress, but it did not do so. Like the Assembly of the League of Nations it refrained from laying down any exception to the rule conferring on the Tribunal the power to pronounce final judgments without appeal.

[29] This rule contained in Article 10, paragraph 2, cannot however be considered as excluding the Tribunal from itself revising a judgment in special circumstances when new facts of decisive importance have been discovered; and the Tribunal has already exercised this power. Such a strictly limited revision by the Tribunal itself cannot be considered as an ‘appeal’ within the meaning of that Article and would conform with rules generally provided in statutes or laws issued for courts of justice, such as for instance in Article 61 of the Statute of the International Court of Justice.

[…]

[32] The Court must now examine the principal contentions which have been put forward, in the written and in the oral statements, by the Governments that take the position that there are grounds which would justify the General Assembly in refusing to give effect to awards of the Administrative Tribunal.

[33] The legal power of the General Assembly to establish a tribunal competent to render judgments binding on the United Nations has been challenged. Accordingly, it is necessary to consider whether the General Assembly has been given this power by the Charter.

[34] There is no express provision for the establishment of judicial bodies or organs and no indication to the contrary. However, in its opinion—Reparation for Injuries Suffered in the Service of the United Nations, Advisory Opinion: [1949] ICJ Reports 182—the Court said:

‘Under international law, the Organization must be deemed to have those powers which, though not expressly provided in the Charter, are conferred upon it by necessary implication as being essential to the performance of its duties.’

[35] The Court must therefore begin by enquiring whether the provisions of the Charter concerning the relations between the staff members and the Organization imply for the Organization the power to establish a judicial tribunal to adjudicate upon disputes arising out of the contracts of service.

[36] Under the provisions of Chapter XV of the Charter, the Secretariat, which is one of the principal organs of the United Nations, comprises the Secretary-General and the staff. The Secretary-General is appointed by the General Assembly, upon the recommendation of the Security Council, and he is ‘the chief administrative officer of the Organization’. The staff members are ‘appointed by the Secretary-General under regulations established by the General Assembly’. In the words of Article 101(3) of the Charter, ‘The paramount consideration in the employment of the staff and in the determination of the conditions of service shall be the necessity of securing the highest standards of efficiency, competence and integrity’.

[…]

[38] When the Secretariat was organized, a situation arose in which the relations between the staff members and the Organization were governed by a complex code of law. This code consisted of the Staff Regulations established by the General Assembly, defining the fundamental rights and obligations of the staff, and the Staff Rules, made by the Secretary-General in order to implement the Staff Regulations. It was inevitable that there would be disputes between the Organization and staff members as to their rights and duties. The Charter contains no provision which authorizes any of the principal organs of the United Nations to adjudicate upon these disputes, and Article 105 secures for the United Nations jurisdictional immunities in national courts. It would, in the opinion of the Court, hardly be consistent with the expressed aim of the Charter to promote freedom and justice for individuals and with the constant preoccupation of the United Nations Organization to promote this aim that it should afford no judicial or arbitral remedy to its own staff for the settlement of any disputes which may arise between it and them.

[39] In these circumstances, the Court finds that the power to establish a tribunal, to do justice as between the Organization and the staff members, was essential to ensure the efficient working of the Secretariat, and to give effect to the paramount consideration of securing the highest standards of efficiency, competence and integrity. Capacity to do this arises by necessary intendment out of the Charter.

[40] The existence of this capacity leads to the further enquiry as to the agency by which it may be exercised. Here, there can be no room for doubt.

[41] In Article 7 of the Charter, after naming the six principal organs, it is provided in paragraph (2):

‘Such subsidiary organs, as may be found necessary may be established in accordance with the present Charter.’

Article 22 provides:

‘The General Assembly may establish such subsidiary organs as it deems necessary for the performance of its functions.’

Further, in Article 101, paragraph 1, the General Assembly is given power to regulate staff relations:

‘The Staff shall be appointed by the Secretary-General under regulations established by the General Assembly.’

[42] Accordingly, the Court finds that the power to establish a tribunal to do justice between the Organization and the staff members may be exercised by the General Assembly.

[43] But that does not dispose of the problem before the Court. Some of the Governments that take the position that there are grounds which would justify the General Assembly in refusing to give effect to awards, agree that the powers of the General Assembly, and particularly its power to establish regulations under Article 101, imply the power to set up an administrative tribunal. They agree that the General Assembly would be able to establish a tribunal competent to hear and decide staff grievances, to prescribe its jurisdiction, and to authorize it to give a final decision, in the sense that no appeal could be taken as of right. They nevertheless contend that the implied power does not enable the General Assembly to establish a tribunal with authority to make decisions binding on the General Assembly itself.

[44] In the first place, it is contended that there was no need to go so far, and that an implied power can only be exercised to the extent that the particular measure under consideration can be regarded as absolutely essential. There can be no doubt that the General Assembly in the exercise of its power could have set up a tribunal without giving finality to its judgments. In fact, however, it decided, after long deliberation, to invest the Tribunal with power to render judgments which would be ‘final and without appeal’, and which would be binding on the United Nations. The precise nature and scope of the measures by which the power of creating a tribunal was to be exercised, was a matter for determination by the General Assembly alone.

[45] In the second place, it has been argued that, while an implied power of the General Assembly to establish an administrative tribunal may be both necessary and essential, nevertheless, an implied power to impose legal limitations upon the General Assembly’s express Charter powers is not legally admissible.

[46] It has been contended that the General Assembly cannot, by establishing the Administrative Tribunal, divest itself of the power conferred by paragraph (1) of Article 17 of the Charter, which reads:

‘The General Assembly shall consider and approve the budget of the Organization.’

This provision confers a power on the General Assembly, for the exercise of which Article 18 requires the vote of a two-thirds majority. Accordingly, the establishment of a tribunal competent to make an award of compensation to which the General Assembly was bound to give effect would, it has been argued, contravene the provisions relating to the budgetary power. The Court is unable to accept this contention.

[47] The Court notes that Article 17 of the Charter appears in a section of Chapter IV relating to the General Assembly, which is entitled ‘Functions and Powers’. This Article deals with a function of the General Assembly and provides for the consideration and approval by it of the budget of the Organization. Consideration of the budget is thus an act which must be performed and the same is true of its approval, for without such approval there can be no budget.

[48] But the function of approving the budget does not mean that the General Assembly has an absolute power to approve or disapprove the expenditure proposed to it; for some part of that expenditure arises out of obligations already incurred by the Organization, and to this extent the General Assembly has no alternative but to honour these engagements. The question, therefore, to be decided by the Court is whether these obligations comprise the awards of compensation made by the Administrative Tribunal in favour of staff members. The reply to this question must be in the affirmative. The obligatory character of these awards has been established by the considerations set out above relating to the authority of res judicata and the binding effect of the judgments of this Tribunal upon the United Nations Organization.

[49] The Court therefore considers that the assignment of the budgetary function to the General Assembly cannot be regarded as conferring upon it the right to refuse to give effect to the obligation arising out of an award of the Administrative Tribunal.

[50] It has also been contended that the implied power of the General Assembly to establish a tribunal cannot be carried so far as to enable the tribunal to intervene in matters falling within the province of the Secretary-General. The Court cannot accept this contention.

[51] The General Assembly could at all times limit or control the powers of the Secretary-General in staff matters, by virtue of the provisions of Article 101. Acting under powers conferred by the Charter, the General Assembly authorized the intervention of the Tribunal to the extent that such intervention might result from the exercise of jurisdiction conferred upon the Tribunal by its Statute. Accordingly, when the Tribunal decides that particular action by the Secretary-General involves a breach of the contract of service, it is in no sense intervening in a Charter power of the Secretary-General, because the Secretary-General’s legal powers in staff matters have already been limited in this respect by the General Assembly.

[…]

[53] In the third place, the view has been put forward that the Administrative Tribunal is a subsidiary, subordinate, or secondary organ; and that, accordingly, the Tribunal’s judgments cannot bind the General Assembly which established it.

[54] This view assumes that, in adopting the Statute of the Administrative Tribunal, the General Assembly was establishing an organ which it deemed necessary for the performance of its own functions. But the Court cannot accept this basic assumption. The Charter does not confer judicial functions on the General Assembly and the relations between staff and Organization come within the scope of Chapter XV of the Charter. In the absence of the establishment of an Administrative Tribunal, the function of resolving disputes between staff and Organization could be discharged by the Secretary-General by virtue of the provisions of Articles 97 and 101. Accordingly, in the three years or more preceding the establishment of the Administrative Tribunal, the Secretary-General coped with this problem by means of joint administrative machinery, leading to ultimate decision by himself. By establishing the Administrative Tribunal, the General Assembly was not delegating the performance of its own functions: it was exercising a power which it had under the Charter to regulate staff relations. In regard to the Secretariat, the General Assembly is given by the Charter a power to make regulations, but not a power to adjudicate upon, or otherwise deal with, particular instances.

[55] It has been argued that an authority exercising a power to make regulations is inherently incapable of creating a subordinate body competent to make decisions binding its creator. There can be no doubt that the Administrative Tribunal is subordinate in the sense that the General Assembly can abolish the Tribunal by repealing the Statute, that it can amend the Statute and provide for review of the future decisions of the Tribunal and that it can amend the Staff Regulations and make new ones. There is no lack of power to deal effectively with any problem that may arise. But the contention that the General Assembly is inherently incapable of creating a tribunal competent to make decisions binding on itself cannot be accepted. It cannot be justified by analogy to national laws, for it is common practice in national legislatures to create courts with the capacity to render decisions legally binding on the legislatures which brought them into being.

[56] The question cannot be determined on the basis of the description of the relationship between the General Assembly and the Tribunal, that is, by considering whether the Tribunal is to be regarded as a subsidiary, a subordinate, or a secondary organ, or on the basis of the fact that it was established by the General Assembly. It depends on the intention of the General Assembly in establishing the Tribunal, and on the nature of the functions conferred upon it by its Statute. An examination of the language of the Statute of the Administrative Tribunal has shown that the General Assembly intended to establish a judicial body; moreover, it had the legal capacity under the Charter to do so.

[…]

[59] The Court has accordingly arrived at the conclusion that the first Question submitted to it must be answered in the negative. The second Question does not therefore call for consideration.

[60] For these reasons, having regard to the Statute of the United Nations Administrative Tribunal and to any other relevant instruments and to the relevant records,

The Court is of opinion,

by nine votes to three,

that the General Assembly has not the right on any grounds to refuse to give effect to an award of compensation made by the Administrative Tribunal of the United Nations in favour of a staff member of the United Nations whose contract of service has been terminated without his assent.

[…]

The response of the General Assembly to the opinion was twofold: (a) to note the opinion and authorise payment of the awards and (b) to create the possibility, in effect, of judicial review by the Court of awards of the Tribunal on the following grounds:

‘[T]hat the Tribunal has exceeded its jurisdiction or competence or that the Tribunal has failed to exercise jurisdiction vested in it, or has erred on a question of law relating to the provisions of the Charter of the United Nations, or has committed a fundamental error in procedure which has occasioned a failure of justice’⁴.

The request would be made by a subsidiary organ of the General Assembly, a committee consisting of the member States, the representatives of which have served on the General Committee of the most recent regular session of the General Assembly. The General Assembly gave the new Committee the necessary authority under art. 96(2) of the Charter of the UN.

The Committee could be approached by a member State, the Secretary-General, or the person in respect of whom a judgment has been rendered by the Tribunal. In that context, Dag Hammarskjöld, the Secretary-General, identified as a fundamental principle ‘that the staff member should have the right to initiate the review and to participate in it. Further, any review procedure should enable the staff member to participate on an equitable basis in such procedure, which should ensure substantial equality’.

The review procedure was used only three times and never with success between 1955 and 1995.⁵ In 1995 the General Assembly, stating that the procedure had not proved to be a constructive or useful element in the adjudication of staff disputes within the Organization, decided to remove the provision for review. Fourteen years later, in a general recasting of the internal justice system of the UN, a two-tier system was established: the United Nations Disputes Tribunal and the United Nations Appeal Tribunal, the decisions of the latter being final and binding.

In the three review cases which did reach the Court procedural issues concerning the participation of the staff member in the procedure before the Court had to be addressed. As the Court read its Statute and Rules, the staff member could not make written submissions directly to the Court, but they had to be transmitted via the UN Secretariat (the employer), and the staff member could not appear at a hearing—which accordingly was not held. The same issues arose in respect of two similar challenges brought against rulings of the International Labour Organization Administrative Tribunal, most recently in the IFAD case.⁶ In those two cases there was the further difficulty that only the employing agency could initiate the challenge process. By contrast the UNAT process gave officials along with the UN and member States access to the process which could lead to a request.

The Secretary-General’s concern for the protection of the status of rights of UN Secretariat members was matched by his emphasis on their responsibilities as independent international civil servants. He addressed these broad matters in an outstanding lecture, given at Oxford University in 1961, shortly before his death in a plane crash in Northern Rhodesia where he was trying to resolve aspects of the crisis in the Congo.⁷ He emphasized the international composition and the international responsibilities of the international civil service. He found guidance in all the provisions of Chapter XV of the Charter and reviewed the pressures brought to bear on the Secretary-General in the previous fifteen years. The continual process of interpretation and clarification in the face of those pressures tended to affirm and strengthen the independence of the international civil service. These developments involved (1) the relation between the UN and member States in regard to the selection and employment of nationals and (2) the relation between the official, their own State, and the international responsibilities of the Organization. A major part of the lecture concerns the implementation of controversial political decisions in a manner fully consistent with the exclusively international responsibility of the Secretary-General. Where was he to find his guidance? Read this excellent address and also Hammarskjöld’s closely related introduction to his 1960–61 Annual Report of the Secretary-General.⁸

The Court in this case, as in others, made use of the doctrine of implied powers (paras. 32–44). But on what basis is such an implication to be made? How is the particular implied power to be related to the powers expressed in the Charter, here the (apparently unfettered) power to consider and approve the budget (paras. 45–51)? How far does this doctrine go, bearing in mind the very wide scope of the purposes and principles of the UN? The authorizing of a peacekeeping force by the General Assembly? The creation of tribunals for other purposes?

If, as the Court says, the General Assembly does not have judicial functions conferred on it by the Charter how can it establish a ‘subsidiary body’ with such functions? Do art. 7(2) and 22 help (para. 54)?

Notice the use which the Court makes throughout the opinion of principle, for instance in respect of implied powers, the character of the judicial function, res judicata, and the independent international civil service.

While in form the Court answered the question using exactly the same words put to it, in substance, as it indicated in the first paragraph (para. 11) of the extract from the opinion set out above and in para. II it limited its answer; the tribunal had to be properly constituted and acting within its competence. That rewriting of the question is a frequent occurrence in advisory cases. To quote Judge Lauterpacht, it is a matter of common experience that a mere affirmation or denial of a question does not necessarily result in a close approximation to truth.⁹ For recent examples of redrafting see the IFAD case¹⁰ and the Kosovo case.¹¹